Review of the regulatory framework for electronic communications

This Communication reports on the functioning of the regulatory framework for electronic communications. The Commission highlights the significant progress achieved since 2002 in opening up national telecommunications markets to competition. It proposes that the process of opening up the markets to competition should continue and that additional actions be taken in two main areas: management of the radio spectrum and the streamlining of market reviews.

ACT

Communication from the Commission of 29 June 2006 on the review of the EU Regulatory Framework for electronic communications networks and services [COM(2006) 334 final - Not published in the Official Journal].

SUMMARY

Under the review of the regulatory framework for electronic communications, this Communication analyses the functioning of the five Directives that make up the framework, namely:

• the " Framework " Directive;
• Directive on the authorisation of electronic communications networks and services (the " Authorisation " Directive); [link to l24164]);
• Directive on access to electronic communications networks and services (the " Access " Directive);
• Directive on universal service (the " Universal Service " Directive);
• Directive concerning the processing of personal data (the " Directive on Privacy and Electronic Communications)

The Communication also launches a public consultation on the future of the regulatory framework for electronic communications. At the end of 2006, the Commission will propose appropriate legislative measures on the basis of the responses received.

ASSESSMENT OF THE REGULATORY FRAMEWORK

The field of electronic communications continues to be a success story for the European Union (EU). The sector has posted strong growth in revenue terms, outpacing the growth of the EU economy. Since the market was opened up to competition, users have benefited from wider choice, lower prices and new products and services.

Within the consultation process, stakeholders have generally given a positive assessment of the impact of the regulatory framework. As a whole, they are of the opinion that even if the framework needs updating in some areas, it has provided greater regulatory stability and facilitated the development of competition and innovation in Europe.

In the view of the Commission, when applied in full, the principles and instruments of the regulatory framework create conditions favourable to investment, innovation and the development of the market. In the last few years, European investments have been as high as, if not higher than, investments in other parts of the world. In addition, operators have invested in the expansion and modernisation of fixed and wireless networks in order to offer innovative services and to cope with competition.

TECHNOLOGICAL DEVELOPMENTS ON THE MARKET

The future revised regulatory framework for electronic communications will have to take account of technological developments on the market and respond to the needs of the sector over the next ten years.

The main technological developments expected in this period are:

• a migration to "all Internet Protocol (IP)" networks;
• increased use of wireless communications and wireless access platforms (3G, WiFi, WiMAX and satellite, for example);
• deployment of fibre optic connections in the local access network;
• the transition to digital television.

These developments will lead to the appearance of new and innovative services for consumers. The review of the regulatory framework for electronic communications should make it possible to adapt to these changes.

PROPOSED CHANGES

Although the current regulatory framework works well, changes are needed in order to maintain its effectiveness. The Commission proposes to make change in two main areas:

• management of the radio spectrum;
• the market review procedure.

The Commission is planning further changes in order to:

• consolidate the internal market;
• strengthen consumer and user interests;
• improve security;
• remove outdated provisions.

Improved approach to managing the radio spectrum

The radio spectrum is an indispensable resource for any application that uses wireless communication, such as mobile phones and broadcasting, and also transport systems (such as aircraft guidance systems) and satellites. The way in which this vital resource is managed in Europe has a significant impact on consumer choices, growth and potential for innovation.

The Commission proposes that some radio spectrum bands could be better managed via a more systematic application of common rules valid throughout the EU. On this basis, the spectrum could be managed in a more flexible manner. The Commission also proposes streamlining the use of the spectrum by introducing the trading of frequencies between operators for certain portions of the spectrum.

Streamlining market reviews

The Commission proposes to reduce the administrative burden linked to the market review procedure. This can be achieved by simplifying the notification requirements for certain draft national measures. National regulatory authorities will still have to carry out market reviews and consultations at the national and European levels. However, the same level of detail will no longer be required for some market reviews and notifications.

This approach fits in with the Commission's Better Regulation initiative.

Consolidating the internal market

To achieve progress towards a genuine European market for electronic communications, the Commission proposes in particular:

• to obtain for itself the right to veto remedies proposed by national regulatory authorities in the event of distortions of competition on the market;
• to draw up at EU level criteria applying when a national court decides to suspend a decision taken with regard to a regulatory matter;
• to adopt a common approach for the authorisation of services with a pan-European or internal market dimension;
• to ensure that users have access to information society services supplied in the other Member States (such as free call numbers);
• to strengthen the capacity of national regulatory authorities to punish infringements of regulatory obligations.

Strengthening consumer and user interests

The main issue in this area relates to the concept of universal service. A study should be carried out into the balance to be struck between sector specific and horizontal rules for protecting consumers and into the feasibility of a one-size-fits-all approach. With this aim in mind, the Commission intends to publish a Green Paper on universal service in 2007 in order to launch a wide-ranging debate on the subject.

To strengthen consumer and user interests, the proposed measures are also intended to:

• improve the information available to consumers regarding tariffs;
• ensure that emergency services have access to information enabling them to locate callers;
• facilitate disabled users' access to emergency services.

Improving security

To improve businesses' and individuals' confidence in electronic communications, a number of measures are being proposed, including:

• the introduction of specific requirements obliging electronic communications providers to notify certain breaches of security and to keep users informed;
• modernisation of the provisions on network integrity.

Removing outdated provisions

Under the Better Regulation initiative, the Commission plans to repeal:

• the provisions relating to the minimum set of leased lines in the Universal Service Directive on the grounds that there are other provisions enabling national regulatory authorities to resolve problems in this area;
• at a later stage, the Regulation on unbundled access to the local loop. The provisions can be repealed once all the national regulatory authorities have completed their market reviews for this sector.

RELATED ACTS

Proposal for a Directive of the European Parliament and of the Council amending Directives 2002/21/EC on a common regulatory framework for electronic communications networks and services, 2002/19/EC on access to, and interconnection of, electronic communications networks and services, and 2002/20/EC on the authorisation of electronic communications networks and services

Communication from the Commission to the European Parliament, the Council, the European Economic and Social Committee and the Committee of the Regions - Report on the outcome of the Review of the EU regulatory framework for electronic communications networks and services in accordance with Directive 2002/21/EC and summary of the 2007 reform proposals

• Better regulation for competitive electronic communications. The Commission proposes improving the existing regulatory environment by reducing ex-ante regulation where market developments permit this. It also proposes simplifying access to radio spectrum to encourage investment in new structures and to release the economic potential of spectrum;
• Completing the single market in electronic communications. The market is currently segmented and suffers from a lack of coherence. The Commission therefore proposes the establishment of an independent European Electronic Communications Market Authority which builds on the greater independence of national regulatory authorities to improve existing coordination mechanisms;
• Enhanced consumer protection and easier access to and use of communications, including for users with handicaps. These proposals are targeted in particular at strengthening security and privacy as well as promoting the quality of services and free access to digital content. The Commission wants to guarantee the independence of the regulatory authorities (themselves often too close to incumbent operators) to ensure that there is competition and that consumer rights are respected.

Directive 2002/21/EC of the European Parliament and of the Council of 7 March 2002 on a common regulatory framework for electronic communications networks and services (Framework Directive) [Official Journal L 108 of 24 April 2002]. This Framework Directive is part of the "Telecom Package" that has served to recast the regulatory framework for telecommunications. The regulatory framework entered into force in 2003. Its aim is to promote competition, consolidate the internal market for electronic communications and serve the interests of consumers and users.

Directive 2002/20/EC of the European Parliament and of the Council of 7 March 2002 on the authorisation of electronic communications networks and services (Authorisation Directive) [Official Journal L 108 of 24 April 2002].

Directive 2002/19/EC of the European Parliament and of the Council of 7 March 2002 on access to, and interconnection of electronic communications networks and associated facilities (Access Directive) [Official Journal L 108 of 24 April 2002].

Directive 2002/22/EC of the European Parliament and of the Council of 7 March 2002 on universal service and users' rights relating to electronic communications networks and services (Universal Service Directive) [Official Journal L 108 of 24 April 2002].

Directive 2002/58/EC of the European Parliament and of the Council of 12 July 2002 concerning the processing of personal data and the protection of privacy in the electronic communications sector (Directive on privacy and electronic communications) [Official Journal L 201 of 31 July 2002].

See also

 For more information, see the European Commission's Information Society website

Last updated: 11.02.2008